[StBernard] EPA's proposed ozone rules could choke Louisiana industry, business group says

[Westley Annis]

EPA's proposed ozone rules could choke Louisiana industry, business group
says
Print Jennifer Larino, NOLA.com | The Times-Picayune By Jennifer Larino,
NOLA.com | The Times-Picayune 
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on July 31, 2014 at 1:24 PM, updated July 31, 2014 at 4:52 PM

Louisiana businesses and consumers could face one of the most expensive
federal regulations in history, according to a new study released Thursday
(July 31) by the National Association of Manufacturers, an industry advocacy
group.

The study, conducted for the association by NERA Economic Consulting,
estimates it will cost Louisiana companies $189 billion over two decades to
comply with new limits on ozone emissions the Environmental Protection
Agency is slated to propose later this year.

The report says the Louisiana economy stands to lose as much as $53 billion
in gross state product and nearly 117,000 jobs per year if the standards are
implemented.

The EPA says current standards do not do enough to reduce ground-level ozone
pollution, which contributes to smog and has been linked to respiratory and
other health problems. The agency initially sought to implement stricter
standards in 2010, but President Barack Obama asked to delay the rules in
light of the economic downturn.

The EPA won't release the details of its plans until December, but has said
it aims to reduce the emissions limit from the current 75 parts per billion
to somewhere between 60 to 70 parts per billion.

In a statement responding to the National Association of Manufacturers
study, the EPA said it is still reviewing technical data and that "any
economic analysis on a new standard would be premature at this point."

The group's study assumes the worst, looking at potential impact under the
60-parts-per-billion standard.

At a national level, the study estimates costs could reach $2 trillion from
2017 to 2040 and result in $270 billion in lost gross domestic product and
nearly 3 million in lost jobs per year.

During a Thursday morning conference call with reporters, National
Association of Manufacturers President and CEO Jay Timmons said the economy
may be on better footing, but it cannot absorb the enormous cost of planned
regulations.

"Manufacturing is slowly making a comeback in the United States and that's
thanks in large part to abundant and affordable energy," Timmons said.
"Ozone standards set at this level could break us."

Timmons added the proposed standards would also mean rising prices for
consumers for everything from cars to electricity.

In Louisiana, the study estimated the new regulations would result in:

A $2,360 drop in average household consumption per year.
An additional $10 billion in costs from 2017 to 2040 for residents to own
and operate their vehicles.
A 15-percent increase in residential electricity prices and a 32-percent
increase in residential natural gas prices.
Closure of 80 percent of the generating capacity at Louisiana coal-fired
power plants.
Environmental groups say the benefits of a proposed rule far outweigh the
costs.

Anne Rolfes, founding director of the Louisiana Bucket Brigade, a New
Orleans-based environmental health advocacy group, said lowering ozone
pollution would improve health conditions for millions of people, including
those with asthma and chronic bronchitis.

Rolfes said the study is yet another case of industry resisting changes,
even if it would do "enormous social good."

"These people should be leaders, they should be visionaries. They shouldn't
be people who are trying to draw us back into the days of bad health all in
the name of industry," Rolfes said.

But the National Association for Manufacturers argues the EPA should work
with manufacturers and other sectors on meeting current rules, rather than
piling on new ones.

Timmons said much of the country has yet to bring ozone levels below
existing standards.

NOLA.com | The Times-Picayune reported last year that ozone levels in the
Baton Rouge area exceeded the national limit in late 2012. Many parts of the
state, including New Orleans, were nearing the 75-ppb threshold.

"The EPA now wants to upend our current work and impose a standard that's
impossible to follow," Timmons said.

Rolfes said enforcement of ozone standards needs improvement and will remain
"a big, big question mark" if the EPA adopts new rules. But she says that's
not an excuse to keep outdated rules in place.

The group also called on the EPA to provide more clarity on what extra
measures would be necessary to cut ozone pollution even further.

David Harrison, co-chair of NERA's environment practice and a study author,
said EPA rules have targeted releases by factories, power plants and cars
and trucks.

But those sources only account for one-third of the emissions reductions
needed to achieve a 60-ppb standard, he said.

Harrison said the National Association of Manufacturers study used past data
to predict what steps more stringent regulations may require, for example,
coal plant closures or the scrapping of older, dirtier construction
equipment.

But Harrison said it's hard to understand the precise impact of the rules
without more details from the EPA.

Jim Patterson, vice president of governmental relations for the Louisiana
Association of Business and Industry, said that uncertainty is worrying.

Patterson said businesses in Louisiana and across the country need a clear
picture of the regulatory environment they're operating in, or they can't
grow.

"When you get hit by wave after wave of these new requirements, which come
with attendant costs, you have to seriously consider whether you can go on
and operate," Patterson said.

He said it is possible to improve the environment and grow the economy, but
it needs to be done at a pace businesses can afford.

"We have to draw a balance between having a healthy, safe environment and a
healthy industry and businesses that generate those jobs," Patterson said.